Successful Self-Publishing: How do you get paid when you self-publish?
It’s hard to imagine when you’re just starting out, but many indie authors make good money from their self-published books. Some make enough for a nice dinner every month, others are running six- and seven-figure businesses based around book sales, with every variation in between.
So how do you get paid as a self-published author? Let’s break it down.
Note: I am not an accountant or financial advisor, and this is not financial advice.
The basics: free to publish, percentage to the retailer, and you get the profits
In this model, it’s (mostly) free to put your book up for sale, the retailer handles customer payments, takes a percentage of each sale and any printing or delivery costs, and then pays you around sixty days after the month of sale.
The percentage for the author versus the platform varies — for example, Amazon offers a 70 percent royalty to authors when pricing ebooks between US$2.99 and $9.99 and 35 percent outside that range or for specific regions if the book isn’t in KDP Select.
Kobo and Apple Books offer 70 percent royalties across the board, while Google Play offers approximately 70 percent (though their discount algorithm can make the actual percentage complex). Nook is slightly less at 60 percent, and if you use aggregators like Draft2Digital and others, they take a cut too, leaving you with around 60 to 85 percent of the sale price depending on which one you choose.
The subscription model payment structure works slightly differently. Kindle Unlimited pays based on pages read from a shared monthly fund. The per-page rate fluctuates month to month. Kobo Plus works on a similar pooled payment system but bases its payments on reader completion percentage and time spent rather than pages.
For print books, the platform calculates the cost to print the book and you add how much you want to make per book. I usually add at least US$2–$3 profit margin.
For audiobooks, the revenue is based on credits, sales, subscription or library borrows and the payment varies based on the contract you agree to.
Check the platform terms and conditions when you publish, as things inevitably change.
Selling direct
If you sell direct, you can make more money per book sale and receive the payment faster, sometimes even the same day. But you also have to manage payment processing, taxes, and also pay for the printing of books upfront. The cash flow and the business model differs substantially, which is why selling direct, especially print books, is usually an advanced indie author decision.
Payment methods and timing
You’ll need to add your bank details to the various platforms. They will need your legal name and your bank account name, which may differ from your author name/s, which are listed separately.
Even if you’re not running a business as an author, it’s a good idea to at least have a separate bank account for your self-publishing activities, as then you can track what’s going in and out.
Many of the services pay directly into your bank account, while others use PayPal or Payoneer. Some charge fees depending on the country and service.
Each of the Amazon country stores pays out separately, and you can add multiple bank accounts so you can have a different one for each currency. I use WISE bank accounts in USD, CAD, AUD, and EUR for my various multi-currency income, as well as my UK bank account in GBP. This reduces bank fees and exchange rate differences. I also pay bills out of those accounts for services in different currencies.
You can find WISE multi-currency banking at my link:
In terms of timing, if you reach the sales threshold for payments on a platform, you’ll be paid monthly, sixty days after the end of the month in which the sales occurred. For example, you will be paid at the end of October for sales in August.
Some retailers have different payment cycles. Kobo, Apple, and Google Play have slightly shorter cycles (around forty-five days), while IngramSpark can take up to ninety days for print book sales to process through their expanded distribution network.
This payment delay is important to factor into your publishing business plan, especially if you’re paying for marketing or production costs every month.
Other forms of income from your books
Books can create income streams that go beyond book sales. Many non-fiction authors create higher-priced products around the topic of their books, like courses, events, consulting, and services.
Affiliate income is another option. As noted in my introduction, there are affiliate links in this book for software and services I use and recommend. If you buy through my links, I receive a percentage of the sale at no extra cost to you, and you might even get a discount.
Advertising revenue for authors with audiobooks has now expanded through YouTube and podcasting, especially for long-running fiction series.
There are lots of ways to make money with your intellectual property assets, and you can find more ideas for multiple streams of income in my book How to Make a Living with Your Writing.
Tax
Every platform will require you to complete a tax questionnaire, all of which have help documentation. This is straightforward for authors in the country where the retailer is based (like US authors on Amazon.com), but requires more work for international authors.
Non-US citizens need to complete a tax form (W-8BEN or W8-BEN-E) in order to avoid a 30 percent withholding tax, which will severely cut into your income. But don’t worry, it’s not complicated.
It’s a simple form you’ll need to submit, mostly online, every few years. Indie author Karen Inglis has a good overview here:
www.selfpublishingadventures.com/tax
If you sell direct, you also need to consider sales taxes and VAT reporting and payments.
If you receive any income from your books, you’ll need to declare it on your tax return.
Keep records of all your royalty statements, payment processor reports, and platform tax documents, like 1099s, and if your indie author business grows, consider using bookkeeping software to make year-end processing easier. You might also want to consult with an accountant who understands creative businesses to ensure you’re taking advantage of all available deductions.
Every country has different tax requirements, so please do your research on what’s necessary for your situation, and check with a professional as necessary.
Reporting and analytics
Most of the platforms produce sales reports that update hourly, daily, or monthly. You can download these reports to reconcile your payments to individual sales, so the entire process is transparent.
This regular reconciliation helps you spot reporting errors early, gauge true read-through rates and advertising return on investment (ROI), and provide accurate numbers to your accountant or tax software.
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If self-publishing is a hobby, then you won’t need to worry too much about all this, but if you are running — or want to run — an author business, understanding the money side is crucial for long-term success. Stay organized from the beginning, and learn how the cash flow works, and you’ll be in better shape as your business grows.
Resources:
• WISE for multi-currency banking — www.TheCreativePenn.com/wise
• How to Make a Living with Your Writing: Turn Your Words Into Multiple Streams of Income — Joanna Penn
• US tax for non-US authors overview — www.selfpublishingadventures.com/tax
• Accounting for Authors: Financial Analysis, Budgeting, Costs, and Margin Made Simple — D.F. Hart & Mark Leslie Lefebvre
• Author’s Business and Financial Handbook: Tips for Bookkeeping, Accounting, and Taxes — Ashley Guion, CPA, MSA
